There is no "blood in the streets."

We are very far from blood in the streets...

There is only blood in SOME streets and rumors of things to come..

Let me get this straight. Forclosures are rising, inflation is rising, oil is rising, gold is rising, lay-offs are rising, jobs are decreasing, dollar value is decreasing, home values are decreasing and the S&P sees a bottom. We haven't even seen the damage from the defaults the credit card companies are going to have. Aren't these the same clowns that rate these thieving bond insures and other companies with bogus ratings to keep them out of trouble also. These guys are trying to by time for a miracle to happen and are gonna make things worse. Good luck folks but I can hear the tick, tick, tick of this financial bomb.

When the wall streeters start telling the blatant lies Beware folks. These scum bag thugs are never held accountable for ripping off the little guy. This is just a paper cut to the market. Wait till they unleash Freddie Krueger "aka" the truth and then you will see the bloodshed.

The blood on the streets has yet to begin. The subprime spreads to other mortgages because the foreclosures will reduce neighboring property values, rendering neighboring homeowners to also be upside down and unable to refinance, creating a spreading epidemic.

Borrowers tend to max out their credit cards with cash advances and stop making car payments in an effort to make mortgage payments. In the end, it still eventually results in a default on all 3 assets.

To say the end is near in subprime (like an S&P credit analyst gainfully employed by the banks) would blindfully ignore the recession's rising unemployment rate and what that can mean for mortgage-paying homeowners missing a spouse's income while facing the same if not rising (because of inflation) expenses.

It's not just people with 500 FICO's duped into buying ARM's. An average 30% of all mortgage originations in 2004, 2005, and 2006 were ARM's. I find it hard to believe 33% of all loans made were subprime. Good people got these ARM's and are now upside down from depreciating home values making awareness-filled choices to consciously walk away from $400K in debt on a home valued at $300K. And that foreclosure only drops values below $300K.

It's also people with outstanding credit gone bad because they're losing their jobs by cost-cutting companies preparing for economic downturn. In a dual income household dependent on both paychecks to pay the mortgage, a job loss would be catastrophic to positive cashflow and meeting obligations.

This goes beyond subprime. The heart of the problem is America's addiction to consumer spending, and the fearlessness to use debt to spend beyond one's means.

Check out this Bloomberg chart (http://www.bloomberg.com/apps/data?pid=avimage&iid=iQUy2GaasArs) of "AAA" CDO's already in danger of losing credit support with rising collateral risk.

The only way we will know when the perfect time to buy was is after the fact. Some stocks have been bought in this market though-- gold, energy, agricultural stocks have been going strong. Others have been getting hit and if some of the hedge funds are in trouble we could see selling near term even of stocks with great prospects. There is also more bad news on foreclosures. So there could be better bargains ahead. If you have a good strategy though you can be in position to take advantage of the market turbulence while controlling for risk. An example of something that might be interesting is a screen of stocks Bill Barnhardt suggested (see Spotlight section-top right- at http://www.Barrelomoney.com) of stocks that pay dividends and have been heavily shorted. If the market turns up, the stocks could make a good move and if things stay bad for awhile you collect the dividends while waiting. At this point though it is a bit early . Protecting good stock holdings by purchasing a small amount of the "ETFs for the Downside" (also in Spotlight ) could help if you monitor stocks closely and can handle the volatility which is not an easy task as we saw yesterday when everybody expected big downside and the market started with a big decline, then turned around to end with a gain (be wary of the "ultra" shares as they can be very risky and volatile). The market has been very choppy so it is wise not to get overextended.